Who Killed California?

Who killed California? Although California remains the most populous state, with 37.3 million people, for the average Americans, the state has lost its appeal. Look no further than the census data, where California grew at a slower rate from 2000 to 2010 than it has since its year of statehood and is now facing one of the largest population slumps in California’s history.

Where is everyone going? The California middle class are leaving the state in droves, heading to other states such as Colorado, Nevada, Arizona and Texas. In the last 10 years, more than 1.5 million people have left California for other parts of the United States than have come to California (according to analysis from the Public Policy Institute of California).

California has always been considered the “golden” state where the growth rate, before the 1990s, had never been below 20%. The state also saw its highest peak of new residents in the 1850s when the Gold Rush increased the state’s growth by 350%. Many people stayed filling up the state and implanting the idea in the rest of American’s minds that California was always in an upward trajectory. It was the “land of opportunity”, home to Hollywood.

Why are they leaving? Most people leave due to high taxes, unemployment and the high cost of living. Others acknowledge that California’s economy is in a slump and there is not a good indication that there will be a turn around. California is currently unable to pay its bills and has resorted to issuing IOUs.

The collapse of the California government may be attributed to its expansion. Between 2003 and 2007, spending grew 31%, compared with a 5% population increase. What does this mean for California residents? According to the Tax foundation, California’s tax burden is the 6th highest in the nation. Add this to the ever-growing regulations, which businesses agree has created one of the “the worst business climates in the nation”, and it is no wonder that California’s unemployment rates are close to 15%.

Some claim the slump was unavoidable. According to Dowell Myers, a professor of urban planning and demography at the University of Southern California, “It had to slow down at some point.” He also points out that for things to dramatically change there would need to be an economic disaster in another part of the county. He claims that if things turned desperate in the Midwest, Southern California may become “a beacon of hope”.

Some claim that due to the population growth, what at one time seemed magical and dream-like, now seems usual and urban. Gone are the days of living in Orange County with the farms and orchards. Add to that the high prices of homes near the coast and most California residents cannot live anywhere near the Pacific and instead find themselves in Los Angeles fighting traffic jams. Their view is not the waves and sandy beaches but strip malls and highways.

Not everyone lives in L.A. but even in less expensive parts of California those who have lower paying jobs have trouble. The American Human Development Project which is a nonpartisan Social Science Research Council recently found that many in California are either wealthy or they are poor. According to William Frey, a demographer with the Brookings Institution,
“The middle is hollowing out.”

Not everyone agrees with this view of California. Some who have migrated from Mexico, like Sara Flores, 28-year-old teacher in Orange County, says she has found her dream. “It’s exactly what I pictured: a better life, a better opportunity,” she said, “Disneyland.”

Filing for Bankruptcy

If you live in California and you are facing financial ruin, filing for bankruptcy protection may be one way to stop a home foreclosure, property repossession, bank account levies, and creditor harassment.

Filing bankruptcy is an important financial decision which should not be done without consulting with a bankruptcy lawyer. Bankruptcy may have serious financial ramifications. Talk to a bankruptcy lawyer and find out if bankruptcy is right for you.

The following two tabs change content below.

Beth

Beth L. is a content writer for Better Bankruptcy. Good content and information is one of many methods we utilize to bring you the answers you need.